Michigan Auto Insurance Requirements & Costs

Michigan requires all drivers to carry liability insurance with minimum limits of $50,000 per person for bodily injury, $100,000 per accident for bodily injury, and $10,000 for property damage. This is often referred to as 50/100/10 coverage. Additionally, Michigan requires Personal Injury Protection (PIP), though since 2019 reforms, drivers can choose from several PIP levels or opt out if they have qualifying health coverage.

The average monthly cost for full coverage auto insurance in Michigan is approximately $198, while liability-only coverage averages around $124 per month. However, your actual rate depends on numerous factors including your age, driving record, location, vehicle type, PIP coverage selection, and the insurance company you choose. Rates can range from as low as $142/month to over $287/month for the same driver depending on the carrier.

Michigan operates under a no-fault insurance system, which means your own insurance pays for your medical expenses and certain other losses regardless of who caused the accident. This is covered through Personal Injury Protection (PIP). Since 2019 reforms, drivers can now choose their PIP coverage level from unlimited down to $50,000, or opt out entirely if they have qualifying Medicare or Medicaid coverage. This flexibility has given Michigan drivers more control over their coverage costs.

Driving without insurance in Michigan carries serious penalties. First offense can result in fines up to $500, license suspension, vehicle registration suspension, and potential jail time. Subsequent offenses result in higher fines and longer suspensions. Additionally, you’ll need to file an SR-22 certificate and will face significantly higher insurance rates when you reinstate coverage. Michigan law also allows for license plate confiscation for uninsured vehicles.

You need SR-22 insurance in Michigan if you’ve been convicted of certain serious violations including OWI/DUI, reckless driving, driving without insurance, multiple traffic violations in a short period, or at-fault accidents without insurance. The SR-22 is a certificate of financial responsibility that your insurance company files with the state proving you carry the required minimum coverage. You typically must maintain SR-22 status for 3 years in Michigan.

An OWI (Operating While Intoxicated) or DUI conviction in Michigan typically increases your insurance rates by 80-150% or more. You’ll also be required to file an SR-22 certificate, which further increases costs. The rate increase typically lasts 5-10 years, and some insurance companies may refuse to cover you at all. Over the course of the SR-22 filing period, the increased premiums can cost you tens of thousands of dollars beyond the legal fines and fees associated with the conviction itself.

Yes, most insurance experts recommend carrying more than Michigan’s minimum required coverage. The minimum property damage limit of $10,000 can be quickly exhausted in even minor accidents involving newer vehicles. Consider higher liability limits (such as 100/300/50 or 100/300/100), uninsured motorist coverage, and comprehensive coverage for deer collisions which are common in Michigan. Regarding PIP, carefully evaluate your health insurance coverage to determine the appropriate level—unlimited PIP provides the most protection but costs significantly more.

You should compare auto insurance rates at least once a year, ideally before your policy renews. Your circumstances change over time – you age, your driving record improves, you may move to a different area, or your vehicle depreciates. Insurance companies also adjust their rates regularly, and a company that offered the best rate last year may not be the most competitive this year. Michigan drivers who shop around annually save an average of $400 or more per year. Major life changes or when Michigan insurance laws change are also good times to compare rates.

The right PIP level depends on your health insurance coverage and financial situation. If you have excellent health insurance with low out-of-pocket maximums, you might consider lower PIP levels ($50,000-$250,000) or opting out if you qualify. However, if you have Medicare/Medicaid only, high-deductible health plans, or want maximum protection, unlimited PIP may be worth the extra cost. Consider that auto accident injuries can exceed typical health insurance limits, and PIP also covers attendant care and lost wages that health insurance doesn’t. Consult with an insurance professional to evaluate your specific situation.

Michigan has one of the highest rates of deer-vehicle collisions in the United States. Deer strikes are covered under comprehensive coverage, not collision. While a single deer collision typically won’t raise your rates (since it’s a no-fault comprehensive claim), multiple claims in a short period could affect your premiums. If you live in or frequently drive through rural areas, comprehensive coverage is highly recommended. The risk is especially high during fall mating season (October-December) and at dawn/dusk hours.